This case involved a member who was admitted to a large superannuation fund in 1990.

In 1999, a member statement showed employer contributions paid into her account for the year ended 30 June 1999 of $2,371.13 from which a contribution fee of $118.56 had been deducted.

The statement also said that a fee of up to 5 per cent would be charged on all contributions, including transfers and rollovers.

In 2013, the member sought to consolidate her superannuation interests and rolled over two separate benefits into the fund. Upon each of these rollovers, a 5 per cent contribution fee totalling $8,431.82 was deducted from the member's benefit.

The member then contacted the fund to complain that the contribution fees had been deducted from the two amounts she transferred to the fund and was not told that these funds would be paid to a financial adviser.

The member complained that she had not been in contact with any financial adviser and sought a refund of the contribution fees that had been debited to her account.

The fund representative confirmed that the adviser would be removed from the member’s account, but the fund refused to refund the fees.

The fund maintained that when the member completed her application for membership in 1990, she had a financial adviser and that the customer information brochure disclosed that a contribution fee of 5 per cent would apply.

While the member acknowledged that a management fee was disclosed to her, the details of how the fee was to be applied were not disclosed, she said, nor was not advised that it was paid as a commission to an adviser.

“The member submitted to the tribunal that no activity or service had been provided that would qualify an adviser for the receipt of a commission,” said Ms Briglia.

“Importantly, neither the trustee nor the adviser had advised the member of the existence of her financial adviser or what services she was entitled to from that adviser and the member terminated the adviser’s connection to her account in the fund as soon as she became aware of it in January 2015.”

The trustee submitted to the tribunal that while there was a business decision in 2008 to remove the contribution fee if there was no adviser on a member’s account, this decision did not apply to the member as she had an adviser.

The trustee said that no documentation was issued to the member or any other member about the decision to remove the contribution fee if there was no adviser because it did not want to encourage clients to not seek financial advice.

It also said that it was a financial adviser’s right to receive commissions that arose as a consequence of the adviser selling the product and was not dependent on the adviser providing ongoing advice to a member of the fund.

The tribunal rejected the bulk of the trustee’s submissions, going on to say in the decision that “to call a fee that is charged an administration charge when the whole of the fee is paid as a commission to a financial advisor could be regarded as misleading”.

“The tribunal found that the member did not appoint a financial adviser as part of her membership application, and that the member and all other members should have been advised of the change in 2008 that the 5 per cent fee would no longer apply if the member requested the removal of a financial adviser linked to that member’s account,” explained Ms Briglia.

In reaching this view, the tribunal, she said, referred to the fundamental trust law principle that “trustees have a duty to act impartially between the beneficiaries in order to avoid benefiting one set of beneficiaries at the expense of another set”.

“The tribunal concluded that the trustee’s decision to refuse to refund the contribution fees debited to the member’s account after the 2008 decision was not fair and reasonable, and ordered the trustee to refund these amounts,” she said.

Ms Briglia said the trustee has appealed the decision to the Federal Court.

This recent determination follows similar case studies heard in the course of the royal commission hearings, when NAB was asked to explain why it continued to deduct plan service fees from its MasterKey Personal Super member accounts, when many of them had no link to an adviser.

A proposal is currently being considered by the royal commission to prohibit all advice commissions that are paid from superannuation products and put an end to grandfathering.

Counsel assisting Michael Hodge recently said that the ability for super funds to charge or allow others to charge member fees, which are then paid to financial advisers in circumstances where the member doesn’t receive or could not have been receiving the services, was a concerning matter.